China’s Economy Is Getting Slow Down Since Industrial Output Growth Fallen To 17½ Year Low
When it comes to the global recession, the experts are already predicting that it’s happening. China which is one of the largest countries in the world recently recorded slowest industrial output growth in last 17½ years. The report shows trade war and low domestic demand for industrial products the main reason behind this downfall. Other sectors, including retail, investment, etc. have also performed far worse than anyone’s expectations. The trade war which China started with the USA a few months ago is now taking a toll on its economy. Now experts are saying that China is most likely going to cut interest rates because of this slow down. However, only a cut of interest rates is not going to solve the problems of China, and it needs some significant economic policy changes. Industrial output growth weakened to 4.4% as compared to analysts predictions of 5.2%. The industrial sector is not profiting well because of the trade war tension with the USA. Industrial exports fell by more than 4.3% this year which is a sign that the country needs some significant economic policies changes.
Recently Donald Trump decided to put another massive amount of taxes on Chinese goods and services starting from September 1st. Chinese currency Yuan is also getting weaker in the international market because of the ongoing geopolitical situation. Trump again said that if China doesn’t agree with the trade deals, they are coming up with the US might increase tariff again in October and December. Now traders are reporting that central bank will reduce the interest rates, which will open a way for giving out loans at low prices to businesses. The government is trying to bail out many domestic companies by giving cheap loans, but that’s not going to solve the problems in the long term.